Liechtenstein And HK Initial DTA

The Liechtenstein government has announced that negotiations for a convention for the avoidance of double taxation and fiscal evasion with Hong Kong have been concluded, and a text initialled.

The agreement is based on the Organization for Economic Cooperation and Development (OECD) Model Convention for avoiding double taxation and, according to the Liechtenstein government, is tailored to the needs of a "dynamic economic relationship characterized by a low tax burden."

The agreement will be signed in the coming weeks once it has been approved by the respective governments. The agreement will then need to be ratified by the respective countries, and will apply to tax years after entry into force.

"With this agreement, we are creating enhanced legal certainty in our economic relations with Hong Kong and are opening new perspectives for the Liechtenstein industry and financial centre in the Asian growth market," said Prime Minister Klaus Tschütscher, noting that it will be of great mutual benefit to businesses and individuals.

On March 12, 2009, the Liechtenstein government committed itself to the global OECD standards relating to transparency and information exchange in tax matters. Against this background, Liechtenstein offered to engage in negotiations with interested countries on bilateral agreements and has meanwhile signed fourteen such agreements over the past months. With the initialing of the agreement with Hong Kong, Liechtenstein strengthens its links with Asia and continues its path of international cooperation in tax matters, with the specific goal of building up a network of double taxation agreements.